Americold Posts 3Q Profit

Credit Lines, Management Upgraded to Fuel Growth

Chris Rank/Bloomberg News

Global warehouse operator Americold reported net income of $24.5 million, or 17 cents a share, in the third quarter, compared with a net loss of $11.9 million, or 17 cents a share, in the same period a year ago. Revenue increased 3.2% to $402 million in 2018 from $389.5 million in 2017.

The company also provided updates on changes to its capital structure and additions to its executive leadership team.

“We were very active on the capital markets front,” CEO Fred Boehler said in a statement released Nov. 8. “We raised $232 million in September in a well-received follow-on [stock] offering, which supports our growth initiatives. We entered into agreements to recast and upsize our credit facility to $1.275 billion while moving it to an unsecured structure. We also priced a $600 million unsecured debt private placement.”

Boehler

As a result of the new financing, Boehler said the company has “meaningfully enhanced” its access to capital at a lower cost.

Americold operates 156 temperature-controlled warehouses in the United States, Canada, Australia, New Zealand and Argentina for approximately 2,400 customers.

Breaking down third-quarter results by segment, Americold said its warehouse operations generated operating income of $93.6 million in the third quarter of 2018, compared with $86.1 million in 2017. Revenue increased 2.3% to $297.2 million from $290.6 million.

Third-party managed warehouses generated operating income of $3.6 million in the quarter versus $3.2 million a year ago. Revenue climbed 3.3% to $62.6 million from $60.6 million.

Transportation management and freight brokerage operations generated operating income of $4.1 million in 2018 compared with $3.1 million a year ago. Revenue was up 12.6% to $40.2 million from $35.7 million.

The company also operates a limestone quarry on land surrounding a warehouse in Carthage, Mo.

“Our third-quarter results were strong,” Boehler said. “While we continue to benefit from a favorable customer mix, we are also capturing internal growth from our ongoing efforts to increase fixed commitment contracts and further productivity improvements.”

A new build-to-suit warehouse in Middleboro, Mass., was completed in the third quarter, and the company signed letters of intent to operate three automated facilities for one major customer, Boehler reported.

Since completing an initial public stock offering in January, Americold has added a number of key executives to its management team. In September, Carlos Rodriguez joined as executive vice president and chief operating officer. He previously worked as senior vice president of distribution and global transportation services for Big Lots Stores.

The company also brought on board Jay Harron as chief investment officer and Scott Henderson as senior vice president of capital markets. Harron was formerly president of Metro Storage International in Brazil, and Henderson previously worked at Citizens Bank.

Earlier in the year, Jim Snyder was appointed chief legal officer. He previously worked at Home Depot, Family Dollar Stores and Pet Retail Brands.

“We believe we have laid the groundwork for further long-term growth and shareholder value creation,” Boehler said in describing the appointments.